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Foreign housing investment grows in Australia: report

Xinhua, July 21, 2015 Adjust font size:

Foreign investment in existing Australian housing markets has grown in the June quarter despite tougher restrictions for such purchases.

Foreigners have increased their presence in established housing markets, especially the southern state of Victoria, according to figures from a National Australia Bank (NAB) report released on Tuesday.

Overseas buyers increased their portion of purchases of existing housing stock to 8.6 percent during the June quarter, up from 7.5 percent in the three months to March 30.

But the report survey also showed foreign buyers of Australian houses becoming less active in the new property market in the second quarter, with their share of national demand falling to 12. 8 percent from 15.6 percent in the first quarter.

The federal government began tightening laws and enforcement of unlawful home purchases by foreign buyers in February, announcing heavy application fees to help the Foreign Investment Review Board (FIRB) monitor the market.

The Abbott government is tipped to tighten the rules further to prevent FIRB approving applications that involve knocking down an existing home because it has reached the end of its "economic life " due to needed renovations seen as a loop-hole to laws by housing analysts.

The NAB's survey distinguished between foreign buyers in the apartment and housing markets for the first time.

The report said foreign buyers accounted for more than 16 percent of all apartment sales in the new property market, and more than 11 percent of all house sales in the second quarter of the year.

Foreigners bought around 28 percent of all new apartments in Melbourne, compared to 16.5 percent in New South Wales. Endi